2022 (12) TMI 80 - HC - Income Tax

Reopening of assessment u/s 147 - validity of order passed u/s 148A(d) - proceedings conducted on deactivated PAN - as stated assessee had filed no response on the merits of the case - HELD THAT - Interest of justice would be served if the Petitioner is given an opportunity to file a supplementary reply to the notice issued under Section 148A(b) - Consequently, the impugned order passed under Section 148A(d) of the Act and the notice issued u/s 148 are set aside and the Petitioner is directed to file a supplementary reply to the notice issued under Section 148A(b) of the Act within four weeks. AO shall pass a fresh order under Section 148A(d) within eight weeks thereafter in accordance with law. Since the proceedings are being conducted on a deactivated PAN, the Assessing Officer is directed to entertain emails / hard copies of the replies / materials / evidences filed by the Petitioner. Present writ petition along with pending applications stands disposed of.

Summary

Issues:
Challenge to impugned order under Section 148A(d) of the Income Tax Act, 1961 and notice issued under Section 148 for Assessment Year 2015-16.

Analysis:
The petitioner, an advocate, challenged the impugned order passed under Section 148A(d) of the Income Tax Act, 1961, and the notice issued under Section 148 for the Assessment Year 2015-16. The petitioner contended that the proceedings were conducted on a deactivated PAN, while asserting that all income tax compliances were made on the correct and active PAN. The petitioner emphasized that the incorrect PAN had been formally deactivated by the Income Tax Department in response to the petitioner's letters. The petitioner further communicated the deactivation of the incorrect PAN to the authorities. The respondent, represented by Mr. Kunal Sharma, stated that the assessee had not responded on the merits of the case, leading to the determination of Rs. 12,06,84,903 as income that had escaped assessment. In response, the petitioner's counsel referred to specific responses provided during the proceeding under Section 142(1) of the Act.

Upon hearing both parties, the Court decided that justice demanded the petitioner be given an opportunity to file a supplementary reply to the notice issued under Section 148A(b) of the Act. Consequently, the impugned order and notice were set aside, and the petitioner was directed to submit a supplementary reply within four weeks. The Assessing Officer was instructed to issue a fresh order within eight weeks in accordance with the law. Noting that the proceedings were based on a deactivated PAN, the Assessing Officer was directed to accept emails or hard copies of materials filed by the petitioner. The Court clarified that it did not comment on the merits of the controversy, leaving the rights and contentions of all parties open.

In conclusion, the writ petition, along with pending applications, was disposed of with the aforementioned directions. The Court's decision aimed to ensure procedural fairness and adherence to legal requirements, allowing the petitioner the opportunity to address the issues raised in the proceedings effectively.